Board Of Director Of The ... vs Union Of India (Uoi) And Ors.
2002 Latest Caselaw 1268 Del

JUDGMENT

J.D. Kapoor, J.

1. Petitioner is one of the delegates of R-2 bank which is a Multi Cooperative Society within the meaning of Section 3(k) of the Act, hereinafter, referred to as the Act.

2. Factionalism in the management of the Bank has chequered history which has reduced it to almost non-functional. Election of Board of R-2 was held on 18.1.1993. After completing its term of 3 years on 17.1.1996 the outgoing Board failed to conduct fresh elections within the stipulated time. As a consequence the Central Registrar appointed a Board of Administrator for the purpose of running the works of the society and holding the election of the Board.

3. In May 1997 one Mr. B.K. Trivedi, Vice President of the superseded board had announced the programme for holding fresh elections. This ensued feud amongst the members of the Board and the Society on the plea that MR. Trivedi had no authority. The Board of Administrators filed writ petition before the Allahabad High Court for restraining holding of the election. The High Court advised them to avail the remedy available under the Act. The Board of Administrators filed a petition before the Central Registrar which was dismissed. Feeling aggrieved the Administrators filed appeal before the Appellate Authority. The Appellate Authority of the Government of India accepted the contention of the Board of Administrators that Mr. B.K. Trivedi had no authority to hold the election and directed the Board of Administrators to conduct the election.

4. Feeling dis-satisfied the Secretary of the bank challenged this order before the Allahabad High Court. The order of the Registrar was upheld and the Board of Administrators were directed to complete the election by 26.2.1999. On 4.2.1999 the Central Registrar directed the Chief Mechanical Engineer, N.E. Railway, Gorakhpur to hold the election of the Board of Directors from those delegates who were elected in the election held by Mr. B.K. Trivedi. This led to another writ petition for quashing the order of the Central Registrar. However, this Court dismissed the petition with the direction that the Board of Administrators should avail alternative remedy available under the Act. Some adverse observations were also made against the petitioner. Finally invoking the order of the Allahabad High Court the Board of Administrators held the election of the Board on 27.2.1999 and handed over the charge to the new Board. As a counterblast the Chief Mechanical Engineer acted on the directive of the Cental Registrar and held election on 28.2.1999 and set up the second Board. Both the elections were challenged by the rival parties.

5. In view of the unending factionalism and setting up two parallel Boards, the Central Registrar passed the order on 19.7.1992 appointing the Administrator and directing him to hold the independent election.

6. The petition bearing No. 15129/99 challenging the election of the Board held on 26.2.1999 was dismissed by this Court again with the direction that the remedy available under Section 74 of the Act be availed. The Registrar Co-op. Societies dismissed the petition challenging the election of the petitioner vide order dated 19.2.2001. Respondent No. 2 preferred an appeal before Respondent No. 1. The appeal was allowed and the matter was remanded to the Registrar Co-op. Societies Delhi for fresh decision as the petitioner took the plea that it being the beneficiary was not heard by the Society. This has given rise to the instant petition.

7. It transpires that the subsequent development in the form of order dated 19.7.2002 passed by the Registrar Co-op. Societies has rendered the whole controversy redundant. The said order was passed in view of the chequered history of factionalism which has brought the functioning of the Bank to the grinding halt because of stalemate in the constitution and functioning of the Board of Directors.

8. There are two secretaries of the two claimant Boards. Each of them wants to receive the cheque from the members of the Society for depositing them in the savings bank accounts of the society. The controversy in the Bank is persisting and both the managements are harming the interests of the Bank. Keeping in view the aforesaid situation, the Central Registrar has rightly exercised his powers under Section 14 of the Act in superseding both the Boards and their Directors and appointing an Administrator to run the affairs of the Society for a period of one year where after the administrator would streamline the working of the Society and facilitate the election as per rules. This order takes care of entire controversy.

9. It is farthest from the mind of this Court to interference in the order of the Registrar in view of the persistent and constant enmeshing of both the groups in the morass of litigation and to bring the society on the brink of ruination and thereby jeopardies the interests of its members. Interests of the members are paramount and not those of the directors of the Board and the members of the executive or the managing committee. We do not find any merit in the petition and dismiss the same as nothing survives in it.